Over the past few months, Paramount (PARA) has seen increased consumer momentum surrounding its free streaming service, Pluto TV.
During an earnings call in May, Paramount Global Co-CEO Chris McCarthy said that Pluto TV “delivered its highest consumption ever” as global viewing time increased by 26% year-over-year during the first quarter of this year.
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Free streaming services, which earn revenue through ads, are growing in popularity among consumers, while paid streaming services are gradually increasing in price.
Related: Paramount makes a harsh decision amid declining sales
According to a recent survey from digital security firm All About Cookies, 84% of people have canceled a streaming subscription in the past, and 44% of the survey’s respondents said that price hikes pushed them to make this decision.
The survey also found that 42% of Americans now watch TV through free streaming services.
Pluto TV leaves viewers divided over controversial change
As Pluto TV faces increased demand, it is reportedly testing out a controversial change on its platform that is drawing mixed reactions from viewers.
Pluto TV has long encouraged users to create a free account on the platform to personalize how they view their content, but there has always been a “Not now” option users can select.
Now, Pluto TV is beginning to require some users to create and log in to an account in order to access certain channels on the platform.
The streaming service has previously tested this change earlier this year, where users who were not logged into an account encountered warnings on their screens, such as “Unlock Free TV” or “Limited Viewing.” However, Pluto TV quickly removed these restrictions from the app, claiming that the change was experimental, according to a report from Cord Cutter News.
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Now, according to recent Reddit posts, some users are flagging that these restrictions have returned to the app, leaving users divided on the change.
In a Reddit post earlier this week, one user said they are unable to switch channels on the platform unless they sign into an account, attaching a screenshot showing content locked behind a login wall.
“As of last night I noticed Pluto is requiring a sign up in order to change channels so that’s it I am out. I kinda figured this day would come as aggressive as they have been about logging in,” wrote the user in the post.
In response to the post, some users said that the new requirement isn’t a big ask, while others worried that the content may no longer be free in the future.
“It’s free, just get a burner email account, it’s not that big of a deal,” wrote one user.
“I’ll agree with most people and say it’s still free, just use another email. But at the same time, since Paramount acquired it, it’s obvious more money is going into advertising and I wouldn’t be surprised if requiring a login is just a step towards putting a price on it,” wrote another.
Pluto TV faces increased pressure
The move from Pluto TV comes after McCarthy flagged during the earnings call in May that, despite Pluto TV’s increased viewership, “monetization has been softer than expected due to the influx of supply.”
“We anticipate supply-demand dynamics will stabilize over time, and the continued increases in engagement on Paramount+ and Pluto will lead to improved monetization over time,” said McCarthy during the call.
Pluto TV is also currently facing increased competition from other free streaming platforms in its space.
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During an earnings call in May, Fox revealed that its free ad-supported streaming platform Tubi faced “accelerating growth” during the first quarter of this year.
“Tubi really is becoming a mainstream service across America,” said Fox Corporation CEO Lachlan Murdoch during the earnings call. “What we’ve seen the difference over the last year or two is Tubi becoming something that’s a very, very good business that serves 65% of its audience.”
DirecTV also launched its MyFree DirecTV app in November last year, which grants customers access to over 90 channels such as CourtTV, ABC News Live, and Bravo Vault, for free.
Related: Amazon pulls the plug on a free service for customers
